RUAECO502 Assignment

Date
Academic Year for Assignment 2021-22
of
Semester V

Subject Title Growth and Development

Subject code RUAECO502

Topic Economic effects incurred through the actions

of Tehrik-i-Taliban Pakistan

Department Department of Economics

Name and Roll no. Vihaan Vadnere (3625-C)

Raj Jadhav (3306-B)

Class TYBA

Email vihaanvadnere1@gmail.com
rajj45211@gmail.com

Phone no. 9082181539

9082971996

Submission: 29th August 2021

Certificate of Completion
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This is to certify that the project titled ‘Economic effects incurred through the actions of Tehrik-

i-Taliban Pakistan’ has been completed by Vihaan Vadnere and Raj Jadav of TYBA Economics

for the paper ‘Growth and Development (RUAECO502)’ dated 29th August, 2021 under the guidance

of Mr Atish Nikam and has not been submitted elsewhere for a degree.

Acknowledgement

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We wish to express our sincere gratitude

towards various books in
libraries for containing knowledge against The Tehrik-i-Taliban which helped us collect
information for our purpose and provided
us an opportunity to conduct our project
We also thank various internet sources
which helped us understand the concepts
mentioned in the project.

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Sr INDEX Page
no. No.
1 Introduction 5

2 Review of Literature 6

3 Terrorist Activities Initiated by Tehrik-i-Taliban 7-13

4 Impact of TTP on Pakistan’s Economy 14-19

5 Conclusion 20

6 Bibliography 21

Introduction

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Rise and Fall and Revival of TTP

TTP was established by al-Qaida-allied tribal militants in Pakistan who before 9/11 had fought in
Afghanistan to support the Taliban regime in Kabul. The Pakistani tribal militants were against the
Pakistani state thanks to what they deemed to be a change within the Pakistani government policies
after 9/11 to support the U.S. war against al-Qaida and allied jihadis, including the Afghan Taliban.
The Pakistani tribal militants hosted al-Qaida and other foreign militants on the Pakistani side of the
border after the U.S. invasion of Afghanistan, which resulted in U.S. pressure for Pakistan to act and
a rise in Pakistani military operations targeting the group and allied networks in Pakistan’s tribal
areas. Their anger against the state hit new heights after the July 2007 operation against a mosque
and seminary within the Pakistani capital closely connected to varied militant groups, referred to as
the Red Mosque operation. The result was the establishment of TTP at the top of 2007 as a jihadi
entity to fight the Pakistani state. Anger over the Red Mosque operation led to many non-tribal and
non-Pashtun militants from settled areas of Pakistan joining TTP and attending TTP and al-Qaida
training camps in Waziristan. Many of those militants had been a part of Kashmir-focused jihadi
groups loyal to the Pakistani state. These non-Pashtun TTP cadres were later categorized Punjabi
Taliban and within the years that followed would play a key role in sophisticated attacks within the
country’s capital Islamabad and its Punjab and Sindh provinces.
After its founding in late 2007, TTP not only grew to become the foremost dangerous terrorist threat
inside Pakistan, taking control of swaths of Pakistan’s tribal areas, but the group also directly
threatened the U.S. homeland. But the cumulative attrition of U.S. drone strikes and Pakistan’s major
Zarb-e-Azb operation launched in June 2014 also as Pakistani intelligence operations degraded the
group’s presence in Pakistan’s north-western tribal region and its operational network.
These setbacks were further aggravated by the interior fracturing and disagreements within the
group, addressed below, which threatened the group’s cohesion. Most damaging to the group was the
interior turmoil that followed the 2013 death of TTP leader Hakimullah Mehsud.16 Competing
factions contested the leadership of the group, leading to infighting and within the years that
followed defections to the Islamic State. This even led to criticism from al-Qaida leadership,
including Usama bin Ladin, who issued multiple warnings to the TTP instructing the group to refrain
from indiscriminate attacks targeting markets and schools, which risked leading to Muslim
casualties. especially, the targeting of young school children within the Army Public School (APS) in
Peshawar in December 2014 led to a backlash in Pakistan and support for a full-fledged operation
against jihadi groups.

Review of Literature

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 The empirical literature of this assignment shows that terrorism is harmful to economic
growth in a less developed country like Pakistan.
 The continuous harmful actions incurred by The Tehrik-i-Taliban TTP have serious
economic repercussions.
 In Pakistan, no study to date has analysed the indirect effect of terrorism on economic
growth. The present study will try to fill this gap.
 The objective of the study is to explore the direct and indirect effects of TTP on economic
growth in Pakistan and the following major terrorist activities incurred by them.

Terrorist Activities Initiated by Tehrik-i-Taliban

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Difference between Tehrik-i-Taliban and Afghan Taliban:

Before the creation of the Tehrik-i-Taliban (Pakistan), a number of their leaders and fighters were a
part of the 8,000 Pakistani militants fighting within the War in Afghanistan (1996-2001) and the
War in Afghanistan (2001) against the United Islamic Front and NATO forces. After the autumn of
the Afghan Taliban in late 2001 most Pakistani militants including members of today’s TTP fled
home to Pakistan. The NY Times quoted a spokesman for the Afghan Taliban stating that the Afghan
Taliban doesn't wish to be involved in TTP, as they need to reject all affiliation with Pakistani
Taliban fighters. it's alleged that the Afghan Taliban relied on support by the Pakistani army within
the past and are still supported by them today in their campaign to regulate Afghanistan. Regular
Pakistani army troops fought alongside the Afghan Taliban within the War in Afghanistan (1996–
2001). Major leaders of the Afghan Taliban including Mullah Omar, Jalaluddin Haqqani, and Siraj
Haqqani are believed to enjoy shelter in Pakistan. Afghan Taliban leader Mullah Omar asked the
Tehrik-i-Taliban Pakistan in late 2008 and early 2009 to prevent attacks inside Pakistan, to vary their
focus as a corporation, and to fight the Afghan National Army and ISAF forces in Afghanistan
instead. because the Pakistani Army began offensives against the Pakistani Taliban, many
unacquainted the region thought incorrectly that the assault was against the Afghan Taliban of
Mullah Omar which wasn't the case.

The group’s current leader Noor Walid Mehsud, who took over after Fazlullah was killed during a
drone strike in Afghanistan in June 2018, has worked to rebuild the group, improve internal
discipline, increase cohesion, and make the group’s violence less indiscriminate. More recently, he
has worked to reintegrate jihadi factions that had left the TTP fold. Between July and November
2020, eight jihadi entities pledged alliance to TTP. report published in February 2021, this increased
the strength of TTP and resulted in a sharp increase in attacks within the region, with one member
state reporting that TTP was liable for quite 100 cross-border attacks between July and October
2020. The report stated that Member State assessments of TTP fighting strength range between 2,500
and 6,000. There has also been a string of mysterious assassinations of TTP commanders in
Afghanistan over the past two years, including one on January 15, 2021, in Afghanistan’s Kunar
province that the TTP blamed on Pakistani intelligence.

A key reason the TTP has been ready to revive its operations is that its regional competitor ISK is
suffering. As noted by Amira Jadoon and Andrew Mines, since 2015, a spread of state-led operations

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against ISK have inflicted substantial manpower and leadership losses upon the group across
Afghanistan and Pakistan. In 2020, ISK’s Wilayat Pakistan claimed a complete of 13 attacks, leading
to 77 casualties (killed and wounded) consistent with the Islamic State’s own reporting, down from
22 attacks in 2019, consistent with data from its Al Naba newsletter. In Afghanistan, ISK has been
largely routed from its former strongholds of northern Afghanistan and therefore the country’s
eastern provinces of Nangarhar and Kunar. The story of how TTP escaped from the shadow of the
Islamic State is printed within the next section.

Targeted Killing of Civilians:

The new targeting guidelines were significant because TTP has historically had a reputation of
indiscriminate targeting almost like the practices of the Islamic State. Since the December 2014
attack on the military Public School in Peshawar, those attacks during which many civilians have
died have included the January 2016 Bacha Khan University attack in Charsadda, the February 2016
targeting of a Shi`a mosque in Peshawar, the December 2017 Agricultural Training Institute attack,
and a July 2018 attack targeting an election campaign gathering in Peshawar. Since then, the general
number of civilians killed per annum in TTP attacks targeting civilians has dropped. Furthermore,
since the targeting restrictions were issued, a smaller proportion of TTP’s attacks have targeted
civilians and civilian fatalities in attacks targeting civilians have constituted a smaller share of
overall fatalities inflicted by the group.

In 2020, TTP claimed 16 attacks that targeted civilians, with 14 deaths. At the time of writing (late
April 2021), there has not been a double-digit fatality suicide bombing claimed and carried out by
the group since the July 10, 2018, attack on the election campaign gathering in Peshawar that killed
23 people, including a provincial assembly candidate, Haroon Bilour, belonging to the Awami
National Party (ANP).

This change of modus operandi is explicitly in line with the TTP September 2018 guidelines, which
provide a clear list of targets restricted to only the security forces (including the armed forces,

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intelligence agencies, paramilitary forces and police), government-allied militias, ruling elites, and
judiciary, and outlines a stringent procedure for suicide attacks. Also noteworthy in TTP’s rebuilding
efforts were a set of stipulations that seem to have been designed to reduce internal tensions.
According to the manual, fighters must follow the instructions of their emir both in military and
theological affairs. It stipulated how internal reconciliation mechanisms were to be put in place at the
local, regional (regulatory shura), and national (supreme shura) levels to manage any incidents of
internal conflict. With the aim of protecting the group and its cohesion, it stated that TTP fighters
henceforth would be prohibited from having any contact with people or groups that differ in
ideology. The new manual also allowed for the return of former members of the group, by stipulating
that fighter who had already defected from the group but intended to re-join were subject to an
appeal to TTP’s supreme shura. These changes were intended to stem further defections while
opening a door for defectors to re-join the group at a time when the global Islamic State narrative
was under severe pressure.

Quetta Incident: 20 people were killed, and 48 injured in an improvised explosive device attack in a
market in Quetta, Baluchistan, targeting the Hazara community. Nine people including six policemen
were killed in two attacks in Dera Ismail Khan district, Khyber-Pakhtunkhwa. The TTP claimed
responsibility for all the attacks. Unidentified assailants forced 14 passengers to disembark from a
passenger bus on the Makran Coastal Highway and then executed them. After militants attacked a
hotel in Gwadar, Baluchistan, killing 5 people, the Baluchistan Liberation Army (BLA) claimed
responsibility. Pakistani law enforcement agencies were responsible for human rights violations,
including detention without charge and extrajudicial killings. Pakistan failed to enact a law
criminalizing torture despite Pakistan’s obligation to do so under the Convention against Torture.
The police in Sahiwal district, Punjab killed four members of a single family including a teenage girl
in an operation police claimed was targeting a militant leader. However, witness accounts suggest
that the police fired indiscriminately at the family’s car. The police officials involved were arrested
and face murder charges.

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TTP conducted 149 attacks throughout 2020. But while TTP carried out only 48 attacks from
January 1 to July 5, 2020, when the mergers occurred in TTP, they executed 101 attacks from July 6
until December 31, 2020. According to TTP’s own metrics for 2020, the group inflicted appreciably
more fatalities after the beginning of the mergers. According to the GTD, the TTP conducted 71
attacks in 2018 and 37 attacks in 2019. The GTD does not yet list data for 2020. Although the GTD
and the authors have small differences in approach in counting attacks the authors’ count of 149
attacks during 2020, with the majority of those attacks taking place after the mergers, speaks to an
acceleration in attacks. There seems to have been a further uptick in attacks in the first quarter of
2021 with 61 attacks claimed by the TTP between January and March 2021.

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A counterargument to explain the increase in attacks in the post-merger period could be that the pre-
merger period covers a large part of the winter season, lasting from November until March in which
a downtick in attacks could be expected. Yet this argument is not particularly convincing when data
from the winter period 2020 is compared to data from the same period in 2021. For example, TTP
carried out 11 attacks in the first three months of 2020 that are five attacks in January, two in
February, and four in March 2020, while since the beginning of 2021, the group has claimed to have
undertaken 61 attacks that are 17 in January, 15 in February, and 29 attacks in March 2021.
According to the TTP’s claims, the main target of the attacks is the Pakistani army, with 73% (110
attacks) of the attacks in 2020 targeting the army. Other targeted actors include the police, civilians,
and security forces. TTP claims, attacks against the army resulted in 179 killings to the army, while
the group reported 16 attacks against civilians resulting in 14 fatalities. The list of TTP attacks in
2020 recorded database includes the claimed killing of a provincial political leader of the ruling party
in the Khyber Pakhtunkhwa (KpK) Haripur district.

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Another important dimension of the TTP attacks in 2020 is their locations. The TTP attacks were
concentrated mainly in five KpK districts of Lower Dir, Swat, and the three newly established tribal
districts: Bajaur, South Waziristan, and North Waziristan where 86% (128 attacks) of all the attacks
took place. These areas remain traditional TTP strongholds and share a border with Afghanistan,
where the group maintained important safe havens in the past. Almost half of the attacks took place
in Bajaur, bordering Afghanistan’s Kunar province.

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Over the last decade, Kunar has been a shelter location for TTP and its former splinters, JuA and
HuA. With North and South Waziristan no longer a safe haven from 2014, Kunar has emerged as the
TTP’s command centre. The TTP’s long presence in Kunar explains why the adjacent district of
Bajaur has been particularly vulnerable to attacks from the group. And with the recent absorption
back into the TTP of JuA and HuA, which both have a strong presence in the neighbouring
Mohmand district, it is possible attacks in Mohmand will increase. Both Bajaur and Mohmand
border Kunar and the latter borders the KpK Peshawar district, which previously remained the centre
of TTP’s brutal attacks. JuA and HuA, then known as TTP Mohmand chapter, has had strong
operational networks in Peshawar and claimed several high-profile attacks there before splintering
from TTP in 2014. It is possible, the Bajaur-Mohmand axis will in the future be the epicentre of TTP
activity. Another interesting point to highlight is that in 2020, the TTP for the first time since ISK’s
emergence in 2014 claimed an attack in the KpK Orakzai tribal district. Orakzai was one of TTP’s
original strongholds in the years after its establishment and Hakimullah Mehsud was based there for
years. It was the local leadership of TTP in Orakzai that founded ISKP in late 2014 with almost all of
the leading TTP figures from the area joining al-Baghdadi’s group. According to local Afghan
sources, the TTP attack claim in Orakzai makes it plausible that segments among ISK’s Pakistani
fighters are re-joining TTP.

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Impact of TTP on Pakistan’s Economy

Pakistan suffers from a high level of terrorism activities incurred by the TTP that has led to a
reduction in economic activity, created uncertainty and increased risk perception leading to
decreased confidence found a 1% increase in the number of terrorist incidents resulted in a reduction
of per capita GDP growth by 0.39 percentage points estimate the total cost of terrorism in Pakistan to
amount to $103 billion. The TTP insurgency accelerated the already dismal economic situation and
has affected almost each and every economic aspect of the country, particularly in FATA and
Khyber Pukhtunkhwa. All the main resources of revenue in affected areas have been hurt, including
agriculture, the tourism industry, manufacturing and small-scale industry. Due to insurgency, the loss
to agriculture alone amounts to Rs.35 billion. The breakdown in law-and-order situation has
damaged the fruit-based economy of the northern areas. It has rendered billions of rupees losses to
the landowners, labourers, dealers and farmers who earn their livelihood from these orchards. Also,
the Economic survey of Pakistan report shows that the share of agriculture in the gross domestic
product (GDP) has been constantly falling. It accounted for 25.99 per cent of GDP in 1999-2000;
however, gradually its share shrank to 21.3 per cent in 2007-2008. The figures show that terrorism
has not only decreased the productive capacity of agricultural activity in these regions but also in the
entire country. The manufacturing sector had been hard hit by frequent incidents of terrorism by the
TTP and has created an uncertain environment resulting into low level of economic growth. The
manufacturing sector is witnessing the lowest-ever share of 18.2 per cent in the GDP over the last
five years. In addition, the small and medium-size enterprises which are key area of manufacturing in
Pakistan have been affected across the country because of power shortages and recurrent terrorist
attacks

The adverse economic impact of terrorism varies based on the economic development of an
economy, as well as the scale, impact and continuation of terrorist activities. Developed countries
experience only short-term impacts given the terrorism incidents are usually infrequent. In addition
to economic growth, TTP also disrupts financial markets and trade, inhibits business investment and
reduces tourism. It has been seen that there is a negative relationship between trade and terrorism.
Estimation shows that terrorism, in addition to internal and external conflicts can distort trade as
much as a 30% tariff on trade. Further, bilateral trade may be reduced by approximately 4% if one of
the trading partner’s experiences domestic terrorism Tourism is particularly vulnerable to terrorism
as it leads to heightened anxiety of travel. Pakistan ranked is 113 out of 130 countries in 2009 as a
tourist destination. The low ranking is attributed to incidents of terrorism and the lack of a tourism
regulatory framework in Pakistan. On account of persistent terrorist attacks many hotels in the
northwest areas have been closed. According to government’s own estimates, the hotel industry in
Swat valley has suffered a loss of Rs. 60 billion. Many workers have lost their jobs and transport has
also face a severe blow.

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Due to war on terror, local people of war-ridden areas are migrating to other areas of Pakistan.
Country has seen the largest migration since independence in 1947. These people have left their
homes, businesses, possessions and property back home. This large influx of people and their
rehabilitation is an economic burden for Pakistan. Unemployment is still prevalent and now the
question of providing employment to these migrants has also become a serious concern. This portion
of population is contributing nothing worthwhile to the national income yet they have to be
benefitted from it. This unproductive lot of people is a growing economic problem of Pakistan.
Direct costs of violence include the costs to the victim and perpetrator that can be monetarily
measured. Examples of direct costs include hospital fees and forgone salary. However, the direct
costs can include the widespread impacts, such as the costs to society such as policing, judicial
systems and incarceration.

Impact of TTP on Pakistan’s Society: Social impacts have also been caused by this war. In a
society where terror exists cannot be healthy. Social disorganization has occurred due to terrorism.
Social relations, economic transactions, free moments, getting education, offering prayers etc. have
suffered. Pakistan’s participation in the anti-terrorism campaign has led to massive unemployment,
homelessness, poverty and other social problems and ills. In addition, frequent incidents of terrorism
and displacement of the local \population have severely affected the social fabric.

Political Negotiations between the Government of Pakistan and TTP: During 2020, the
Pakistani government and the Tehrik-e Taliban Pakistan (TTP), which has, since its inception in
December 2007, been openly fighting the Pakistani government, conducted secret peace
negotiations, militant sources exclusively confirmed to The Diplomat. While these negotiations went
into much detail, the talks eventually collapsed in late 2020 or early 2021 with no indication that they
might resume. To the contrary, a spike of attacks claimed by the TTP indicates that they are back on
the war path, which has consequences for Pakistan’s tribal areas and beyond. The TTP and the
Pakistani government were negotiating peace was confirmed by two active TTP members residing in
eastern Afghanistan, as well as a former insurgent who is still well-connected amongst TTP
members. The TTP members were reluctant to share details and TTP spokesman Mohammad
Khorasani could not be reached despite repeated attempts. But the former insurgent, who is in
regular contact with TTP members, outlined what was discussed during negotiations under the
condition of anonymity. In late December 2020 or in early January 2021 negotiations broke down.
This was confirmed to The Diplomat by an active TTP member, who only said that the TTP rejected
certain conditions without elaborating. The former insurgent stated, though, that the conditions that
were unacceptable to the TTP would have amounted to the TTP becoming a proxy force of the
Pakistani government. These echoes warnings voiced by former TTP spokesman Ehsan in the op-ed
cited above. However, this should be taken with utmost caution Ehsan’s text is undoubtedly biased
and the former insurgent who spoke to The Diplomat is also prejudiced against the Pakistani
government.

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Another cause for the collapse of the negotiations might have been dissent within the TTP. While not
explicitly mentioning this as a reason for the failure of talks, the former insurgent told The Diplomat
that some, in particular younger TTP members, were opposed to negotiations as they thought that
Pakistan would deceive the TTP and saw the proposed settlement as an undue capitulation to the
Pakistani government. Whether or not internal dissent was a significant reason for the collapse of the
negotiations between the TTP and the Pakistani government, the reported reaction of some more
radical TTP elements shows that chances to successfully negotiate with fundamentalist jihadist
groups might have narrow limitations.

TTP’s Impact on Education: Threats to education in Pakistan were spotlighted by the attacks on
future Nobel Peace Prize laureate Malala Yousafzai on October 9, 2012, and the Army Public School
in Peshawar on December 16, 2014. After the Peshawar attack, which killed 135 children, Prime
Minister Nawaz Sharif announced a 20-point National Action Plan to comprehensively deal with
terrorism – but none of the 20 points pertained to students or education. In some areas, government
forces had used educational institutions, including both schools and college hostels, as temporary or
permanent barracks or military bases. When educational facilities are used for military purposes, it
places them at increased risk of attack. The government should issue clear and public orders to
Pakistan security forces to curtail the military use of schools. Pakistan should develop a
comprehensive policy for protecting students – especially girls and teachers, schools, and universities
from attack and military use, and engage all concerned ministry staff at the central and local level in
implementing this strategy, Human Rights Watch said. Securing schools has been largely left to the
provincial governments, and these efforts have been sporadic and vary across provinces, with little
attention to the specific need to protect girls’ education. In most cases, responsibility for enhancing
and maintaining security has been passed to school authorities. This has led to increased hardship
and chaos. Criminal cases have sometimes been filed against teachers and principals for not taking
security measures.

Despite hundreds of attacks on teachers, students, and educational institutions, the Pakistani
government has not successfully prosecuted the perpetrators in most instances. This failure was
highlighted in June 2015, when it was reported that eight out of the 10 individuals arrested and
charged for the attack on Malala Yousafzai were acquitted, even after they all confessed to their role
in court. Pakistan’s national government should cooperate with provincial authorities to create an
advance rapid response system whenever there are attacks on schools, so that these facilities are
quickly repaired or rebuilt and destroyed educational material is replaced so that children can return
to school as soon as possible. During reconstruction, students should be provided education through
alternative means and, where appropriate, given psychosocial support.

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TTP’s attitude towards Women’s Rights: The Taliban claimed it was trying to ensure a society in
which women had a safe and dignified role. But the facts show the opposite. Women were stripped
of their dignity under the Taliban. They were made unable to support their families. Girls were
deprived of basic health care and of any semblance of schooling. They were even deprived of their
childhood under a regime that took away their songs, their dolls, and their stuffed animals all banned
by the Taliban. Taliban's discriminatory policies violate many of the basic principles of international
human rights law. These rights include the right to freedom of expression, association and assembly,
the right to work, the right to education, freedom of movement, and the right to health care. The
burqa is not only a physical and psychological burden on some Afghan women, it is a significant
economic burden as well. Many women cannot afford the cost of one. In some cases, whole
neighbourhoods share a single garment, and women must wait days for their turn to go out. For
disabled women who need a prosthesis or other aid to walk, the required wearing of the burqa makes
them virtually homebound if they cannot get the burqa over the prosthesis or other aid, or use the
device effectively when wearing the burqa.
Restrictions on clothing are matched with other limitations on personal adornment. Makeup and nail
polish were prohibited. White socks were also prohibited, as were shoes that make noise as it had
been deemed that women should walk silently. Even when dressed according to the Taliban rules,
women were severely restricted in their movement. Women were permitted to go out only when
accompanied by male relatives or risk Taliban beatings. Women could not use public taxis without
accompanying male relatives, and taxi drivers risked losing their licenses or beatings if they took
unescorted female passengers. Women could only use special buses set aside for their use, and these
buses had their windows draped with thick curtains so that no one on the street could see the women
passengers. One woman who was caught with an unrelated man in the street was publicly flogged
with 100 lashes, in a stadium full of people. She was lucky. If she had been married, and found with
an unrelated male, the punishment would have been death by stoning. Such is the Taliban's
perversion of justice, which also includes swift summary trials, public amputations and executions.
The Taliban perpetrated egregious acts of violence against women, including rape, abduction, and
forced marriage. Some families resorted to sending their daughters to Iran to protect them. The
Pakistani Taliban threatened women’s rights activists who organised demonstrations to mark
International Women’s Day in the country, accusing them of blasphemy and obscenity. The Taliban
statement followed a flurry of falsified images and video clips on social media that suggested
participants in the protests had insulted Islam, which they strongly denied. Islamist groups held
demonstrations in several Pakistani cities to demand that the government prosecute the march
organisers for blasphemy, and they threatened vigilante action. Blasphemy carried the death penalty
in Pakistan. Although Pakistan has never carried out such a sentence, vigilantes often kill suspects
before they are brought before a court. Pakistan has seen violent nationwide protests against France
over issues such as the Charlie Hebdo cartoons and restrictions on the Islamic veil there for Muslim
women. Hassan Abbas, a security expert at the National Defence University in Washington, said the
Taliban statement should be a “wake-up call” for Pakistani security agencies.

Drug Trafficking: Pakistan’s geographic location next to Afghanistan, the world’s largest producer
of opium, places the country in a veritable front-row position in terms of drug trafficking. Its
establishment has left no stone unturned in exploiting this geographic location to its own advantage.
The money generated from the drug trade has been used to fund proxy terror groups. The role of
narcotics in funding terror activities of the TTP has been found. While poppy cultivation has largely
been eliminated in Pakistan, the crop is still grown in large parts of southern provinces of

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Afghanistan like Kandahar and Helmand, where the Taliban has a strong influence. Analysts say
opium poppies and heroin are among the main sources of income for the Taliban, which controls 80
percent of the drug production area in Afghanistan. The problem for them is how to transport these
drugs to other countries. Here, Pakistan acts as a facilitator. The drug consignments, in connivance
with Pakistan’s authorities, are smuggled through the Pakistan-Afghanistan border. From there, these
consignments head for Pakistan’s air and seaports and, hence, to further destinations in China,
Southeast Asia, Africa and Europe. Pakistan provides a vital transit route for smuggling of drugs
worth $30 billion from neighbouring Afghanistan. Though not a major reason, Pakistan backs
restoration of Taliban rule because if the group returns to power, all these drug cartels could be
resuscitated and its major benefactor Pakistan will have even more funds with which to sponsor its
proxy terror groups. The issue of narcotics smuggling has the potential to derail Pakistan’s bilateral
relations and besmirch its international reputation. Indeed, the question arises as to why Pakistan
would jeopardize its relations with other countries in order to benefit from narcotics. The answer is
that the money derived from drug smuggling serves Pakistan’s larger agenda of sponsoring proxy
terror groups. With the plenary session of the intergovernmental Financial Action Task Force
(FATF) scheduled for later this month, Pakistan’s role in funding terror organizations through
drugs/narcotics smuggling is sure to come up for discussion, as the FATF determines the country’s
listing. Pakistan will be blacklisted, if it does not take action to stop drug proliferation. Blacklisting
by FATF could spell ruin for Pakistan’s already dwindling economy.

Impact of the TTP in Pakistan’s Foreign Direct Investment: The higher levels of terrorism risk
are associated with lower levels of net FDI. In case of Pakistan, terrorism has affected the allocation
of firms investing money in the country. As a result, FDI, which had witnessed a steep rise over the
previous several years, was adversely affected by the terrorist acts in the country, especially in
FATA and other areas of Khyber Pukhtunkhwa. Perceptions of the TTP risk have a great deal of
influence on some investment decisions, and very little on others. Among the factors that influence
decision makers are the economic health of the investment destination, the difficulty associated with
doing business in a given country, the existence of rule of law and good corporate governance, the
existence of corporate and government connections, and of course the cost of production. Investors
may also distinguish between perceptions of the existence of a TTP threat in a given FDI destination
and acts of terrorism, or between domestic acts of terrorism and international acts of terrorism.
However, one factor often not considered when contemplating making a cross-border investment is
consumer behaviour, and its linkage to the political process. Perceptions are important here, as well.
Predicting consumer behaviour correctly can be as important in determining the success of an
investment as predicting whether terrorism will have an impact on operational capability. An
increase in terrorist violence reduces FDI. Furthermore, the disaggregated analysis by individual
sectors explores the nuances in considerations for FDI, where some sectors are affected while others
remain immune to terrorism-related risks. It has been illustrated that FDI flows to certain industrial
sectors are more susceptible to terrorism than other sectors that attract investments to remotely
located facilities. All this creates demand for huge external capital for undertaking huge projects and
indirectly promoting growth.
In case of Pakistan, the TTP has affected foreign investment in the country. Ultimately, FDI was
increased many years in the past but TTP events had negative effect on FDI in the country.
According to the World Economic Forum, Pakistan got 113 out of 130 countries in 2009 as tourism
destination due to increasing of terrorism events of TTP and the hotel industry faced a loss of Rs. 60
billion and a loss of Rs. 35 billion in agriculture. The loss to agriculture alone amounts to Rs.35

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billion. Economic survey of Pakistan report has explored shows that the stock of agriculture in GDP
decreasing, 25.99 % of GDP in 2000 and 21.3 % in 2008. After September 11, 2001, destruction to
the Pakistani economy is estimated at 68 billion dollar for ten years. The important sources of profits
are affected adversely like agriculture, tourism, manufacturing and small-scale industries due to
terrorism events in Pakistan. Foreign investments are important for emerging economies that support
to build saving investment gap, makes employment opportunities, profits from transfer of
technology, and finally gives economic growth of host countries. Foreign investments not only
facilitate emerging economies with urgent capital for investment, they also improve job creation,
managerial skills as well as transfer of technology. All of these finally support the economic growth
and development. Therefore, emerging economies are very interested to encourage foreign
investments. Foreign investments are very necessary for the economic growth of Pakistan that fulfils
the gap of saving-investment. Pakistan does not have enough inside generated facilities to keep the
speed of economic activities; therefore, FDI is very necessary to attract the local investment in order
to gain economic objectives. FDI is necessary for Pakistan in order to support projects of
development, empowering industrial sectors, enhance job opportunities, getting improved
technology, support local managerial skills, helping productivity and output, increasing balance of
payments, foreign exchange reserves, physical infrastructure and human resources and finally getting
higher rate of economic growth.

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Conclusion

The terror brought by the TTP in its wake has led psychological problems. Fear in the hearts of the
people is created. Trauma, depressions and confusion have been increased. The people feel insecure
and unsafe whenever in their daily life activities, as time and again they watch the terror events
taking place in different cities. Those have especially been suffered who have closely witnessed the
suicidal bombings. The religion is also impacted by the war against terrorism. The religion of Islam
is perceived to be the one tolerating extremism and terrorism abroad. In the western world people
equate violence, abuse against women and minority rights, and several acts of terrorism like suicidal
bombing and coercion with Islam and Muslims. Whenever any such inhuman act takes place, they tie
it with Islam and its followers. When in the UK terror acts were committed the authority blamed it
on Pakistani citizens for instance. And why these days Pakistanis are discriminately interrogated and
have to be screened before they inter the US is due to the fact that they are Pakistanis and Muslims.
Pakistan is a peace-loving nation and playing its important role in combating terror. Recognition of
efforts to fight menace of terrorism and sacrifices rendered thereof are testimony to the commitment
and resolve to bring peace in the region. Unfortunately, sometimes its commitment is doubted by
some of its allies. Mistrust can lead to diversion of efforts, which will not be beneficial to common
objective of peace in the region. Pakistan is a responsible nation; fully capable of defending its
territorial integrity. Pakistan has singularly committed large forces to combat menace of terrorism
more than any other country. No foreign troops are either present or deployed on Pakistan soil.
All citizens of Pakistan must propagate moderate vibrant culture of Pakistan to promote good will of
world community and shun misconstrued beliefs. Attacks on security forces personnel are executed
at the sponsorship of hostile intelligence agencies. Such anti state elements must be singled out and
brought to lime light to defeat evil agendas of our enemies. Pakistan has sacrificed the most in the
ongoing war on terror; criticizing Pakistan’s efforts at national/international forum will be counter-
productive to the overall objectives of war on terror.

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Bibliography

 https://cisac.fsi.stanford.edu/mappingmilitants/profiles/tehrik-i-taliban-
pakistan#text_block_19701

 https://www.thehindu.com

 https://jamestown.org

 https://ctc.usma.edu/the-revival-of-the-pakistani-taliban/

 https://thediplomat.com/2020/10/pakistans-drug-habit-is-endangering-the-region/

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